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Overview
Procurement Services
Excess Inventory
shortage sourcing
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The open market provides a critical resource to clients faced with fulfilling shortage requirements. Whether part shortages are due to obsolescence/EOL considerations or allocation/lead time considerations, Magellan has the expertise to qualify and source reliable open market supply to meet client demand.

The open market reacts much like any other reasonably efficient market in the face of new information. For example, if demand for a part spikes due to a shortage at franchised distribution, the price of the open market supply will increase. Conversely, if the market is flooded with excess supply of a part in the face of constant demand, then the price of that part will fall.

Fulfilling shortage requirements on the open market requires careful and efficient dialogue with a trusted supplier in order to maximize reliable sourcing opportunities while minimizing procurement costs. Magellan goal is to serve as that trusted open market supplier for our clients.

Key success factors in shortage sourcing are:

  • Open Communication Lines – Magellan's Sales Executives and the Customer Support Team maintain open communication lines with each client and are always standing by to address shortage needs.
  • General Sourcing Guidance – If a client has general restrictions with regard to date codes, factory sealed packaging, etc., it is important for this guidance to be understood up-front; such guidance impacts sourcing prioritization and the processing of exceptions.
  • Early Action – Shortages that are identified and addressed sooner, rather than later, tend to be resolved with less cost and disruption to a client's production environment.
  • Controlled Information Dissemination – The pros of involving multiple suppliers in any sourcing effort should be balanced against the cons of “heating up” the market on a particular part and risking adverse cost consequences.
  • Rapid Response – Managing a shortage purchase requires rapid communication between the client and Magellan and decisive action in order to avoid rising prices and losing stock on the open market.
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